Workers Compensation

Workers Compensation

Workers’ compensation was introduced in the United States a century ago to grant medical care and monetary awards to employees hurt on the job while avoiding costly and protracted litigation. It has become a challenged line of business, and some carriers say a worst-case scenario may again become reality if the new laws some states have adopted don’t produce at least some of the promised savings.


Some states have implemented new reform laws


For example, if your business were located in New York, that state’s workers’ compensation system is arguably the most adversarial of any state in the nation. New York and Illinois recently underwent changes in their systems that were similar to California’s new reform law in that they provided immediate benefit increases with promised savings. Some people believe the reforms will yield some savings. Without the reforms, the rate increases over the next few years that employers are now seeing would be much higher.


Oklahoma’s workers’ compensation insurance system is currently the sixth most expensive in the nation and in dire need of reform. The costs of maintaining the system are high, and the size and burden of the system are a strong factor in businesses’ choice to expand or relocate.


Injured workers finding difficulty surviving on benefit payments


Meanwhile, injured workers who enter the befuddling system often find themselves trapped in nightmarish delays. Justice can take months or years, and leave many injured workers unable to support themselves and their families on the modest benefits. As an employer you may face pressures to reduce injuries because compensation insurance premiums remain a major drain on company profits.


Many do not believe the system is doing enough to ferret out fraudulent claims. To minimize workers’ comp costs, many employers discourage injured employees from filing claims and retaliate against those who do, injecting a climate of fear into a system specifically created to reduce acrimony and litigation over workplace injuries.


The expense of workers compensation insurance PA is of obvious concern to businesses across the nation. The hope is that the new reforms will turn the tide, but if the new reforms can offer some form of savings the question still remains whether those savings will be enough to immediately impact rates. Your company may have no plans to raise rates, but it is likely some of those savings must first be realized before any rate reductions to the cost of insurance could even be considered.